Indian Commodity Exchange, a screen-based online derivatives exchange for commodities, has gone live.
Indian Commodity Exchange (ICEX) commenced operations with the launch of Diamond Futures, which will be the world’s first derivatives contracts in diamonds.
Among those present at the inauguration in Mumbai included V N Kaul, an independent director of Reliance Capital, which is one of the prominent shareholders of ICEX.
The exchange will start trading in 1 carat/100 cent contracts and will eventually add 50 cent and 30 cent contracts.
Market Dynamics to Change
The futures, two-and-a-half years in the making, followed talks with the Ministry of Finance and the Securities and Exchange Board of India.
It is expected that the launch of Diamond Futures trading on ICEX will lead to efficient price discovery based on demand and supply fundamentals and a nationwide market participation.
Singapore Interest
To date, 100+ members and around 4,000 clients have registered with the exchange. Indian diamond cutters are said to polish 14 of every 15 of the world’s gems.
Polishers source their gems from De Beers, the world’s biggest diamond producer, and also through direct imports from some producing nations.
Earlier this year the Singapore Diamond Investment Exchange, (SDiX) and the Multi Commodity Exchange of India (MCX) agreed to forge a strategic alliance via a Memorandum of Understanding (MoU) to launch spot and derivatives contracts on diamonds in India, including using the SDiX-traded reference prices.
